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The Parking Factor – What to Consider When Purchasing Your Next Commercial or Residential Property

March 6, 2017

IMAGE CREDIT: Build a better Burb

If you’re in the market to purchase either commercial or residential property in the greater Miami area, you’re probably wondering if getting a property that has parking — either within the building, on the street or anything similar — will increase the value of your property. When it comes to real-estate investment in Miami — and, more specifically, the so-called “parking factor” — the answer to its impact may surprise you!

The Parking Factor: How It Improves Your Commercial Property Value

An unspoken rule amongst real-estate agents is that any amenity provides an increased value to the commercial property. By what percentage that amenity improves the value of the commercial property, however, is up for debate.

When looking at a commercial property, the following questions need to be asked:

1. Does This Amenity Justify Asking for a Higher Rent From a Tenant?

For example, let’s suppose that you purchase a property with a lot of office spaces, which you will then rent out to a series of prospective tenants that you will ask for a certain amount of rent from. Without providing them an amenity, like parking, for themselves and their clients, you — as the property owner — cannot justify asking for a higher rent from a tenant.

IMAGE CREDIT: Miami New Times

2. Is the Parking You Provide Safe?

Parking in Miami means more than just providing a slab of concrete on the ground and a few paint marks to indicate where the car needs to go. Rather, your building’s parking needs to be clean, updated, brightly lit (because there’s nothing worse than a tenant trying to stumble around, in the dark, looking for their car) and safe.

IMAGE CREDIT: CBSMiami

3. Can the Parking Structure Be Used as Another Source of Income?

If you have more parking spaces in your structure than you have tenants/clients, you can rent out the additional space to neighboring buildings that otherwise don’t have this amenity available for their tenants and clients.

IMAGE CREDIT: Thomas Stefan

Conclusion

In short, while commercial real estate in Miami is a good investment, overall, it’s an even better investment if you have a parking structure — or, at least, available parking — that comes with it! Best of all, parking increases the value of your Miami commercial property.

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